State of Blockchain Q1 2018 Report

Peter Ryan with Disqus detailed some of the top 6 takeaways that defined Q1 2018:

It’s a bear market for crypto. Following its peak of $20K, bitcoin suffered a 51 percent decline in the first quarter. However, 79 percent of respondents to the CoinDesk Sentiment Survey said they thought this bear market would be short-lived.

Crypto market is maturing. Bitcoin futures markets were introduced in Q417, and there’s been steady growth in this activity through Q118. But the shorts outpaced the longs, 5,000 to 3,000, which has likely led to the slumping price, along with a fall in demand in the spot bitcoin market.

Miners stay long. The amount of processing power devoted to securing the bitcoin network diverged from the market cap, with the hash rate (a measure bitcoin mining) growing 47 percent over the quarter. Miners take the long view.

Taxes are coming into the picture. Cryptocurrencies generated an estimated $70 billion in global tax revenue for 2017. But the tax parameters around crypto remain confusing to survey respondents, both about the legal and tax status of the entire asset class.

ICOs continue to boom. ICO raised $6.3 billion in Q1, and the average raise has almost doubled from $16 million to $31 million.

Fees decline. Transaction fees on the bitcoin network dropped from an average of $40 in Q417 to around $9.49 per transaction in Q118.

As for the broader opportunity for the blockchain, SiliconAngle’s James Kobielus writes that today’s blockchain startups “will need to show that they have staying power and can ride a ‘land-and-expand’ strategy to greater success.”

And he asserts that to be considered to be mature enough for broad enterprise deployment, a commercial blockchain platform would need to meet several criteria:

Blockchain solutions should be general-purpose in their ability to be deployed into a wide range of industries, business functions and other application domains.

They should be deployable into private clouds, public clouds and various multicloud deployments of a hybrid, B2B and community-wide nature.

They should be able integrate seamless with enterprise investments in other data, transaction, security and other platforms.

They should be standardized within a dominant open-source community with wide representation.

He also writes that:

Of the principal blockchain projects, only the Linux Foundation’s Hyperledger Fabric is likely to become the standardized foundation for truly enterprise-grade open-source blockchains. Contributed by IBM Corp. and Digital Asset, Hyperledger, now in version 1.0, boasts more than 185 collaborating enterprises across finance, banking, the “internet of things,” supply chain, manufacturing and technology.